How Can We Obtain Freedom from Hidden Costs?

The liberty principle for this Freedom Friday concerns the hidden ways that the government picks taxpayers’ pockets. As Tyler O’Neil noted in his article published at The Daily Signal, “Americans expect to pay federal taxes,” but they do not like being taxed in hidden ways. O’Neil quoted Wayne Crews from the Competitive Enterprise Institute as saying: 

“American households pay at least $14,000 in hidden regulatory costs every year,” Wayne Crews, the Fred L. Smith fellow in regulatory studies at the institute, says in a new video provided exclusively to The Daily Signal. “Instead of finding ways to cut those costs for Americans, President Biden’s whole-of-government policymaking framework prioritizes political causes like climate change and equity in the regulatory process.”

“At CEI, we believe it is essential to increase transparency and accountability in the rulemaking process, and make sure rulemaking agencies stick to their original mandates,” adds Crews, who lays out three major recommendations in his new report, “Ten Thousand Commandments: A Snapshot of the Federal Regulatory State,” published Wednesday.

“Rules made by federal agencies impose a cost of government that extends well beyond what Washington taxes,” Crews told The Daily Signal. “Federal environmental, safety and health, social, and economic regulations grip the economy, making it needlessly harder and more expensive to run a household or business in this country.”

His analysis – the latest in a series of annual reports – finds that the average American household pays $14,514 annually in a hidden regulatory cost.

“This amount exceeds every item in the household budget, except housing,” notes the report, which The Daily Signal obtained prior to its publication. “A typical American household spends more on embedded regulation than on health care, food, transportation, entertainment, apparel, services, or savings.” That number represents 17% of an average income before taxes ($87,434 in 2022).

Crews calculated the costs of regulation on the entire economy as $1.939 trillion, and found the average cost per household by dividing that gargantuan number by 133.6 million households.

[The article has a graph that] shows the regulatory costs in 2020 plotted alongside the costs households paid for other goods and services in 2020. It shows that the cost of regulation is greater for households for every item but housing.] …

Regulations issued by the executive branch far outstrip the number of laws Congress passes each year. During the 2022 calendar year, agencies issued 3,168 rules, while Congress enacted only 247 laws….

The report suggests a wide range of reforms to check the growth of regulation. It urges Congress to require congressional approval of significant or controversial agency rules before they become binding. It urges Congress to require annual regulatory transparency report cards and legislation requiring the automatic sunsetting of regulations. It urges Congress to pass a law preventing presidents from using “emergency declarations” to impose permanent government controls. It also urges Congress to identify which federal agencies do more harm than good and to eliminate them or shrink their budgets. It also urges Congress to set up a regulation-reduction commission to identify unneeded regulations to eliminate.

“Congress should start preparing now for substantial reforms to wrangle regulations back under control and put Congress back in charge,” Crews told The Daily Signal.

Congress passed the Sixteenth Amendment on July 2, 1909, and the States ratified it on February 3, 1913. This amendment established the right for Congress to impose a Federal income tax. There is no amendment that establishes the right of the Executive Branch to impose regulatory costs. The hidden costs imposed by the various agencies are not constitutional.